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ANALYSIS OF RECENT SCV UNPUBLISHED ORDERS

[Posted May 16, 2010] The Supreme Court of Virginia has issued five unpublished orders in the past two weeks. Those don’t carry the same precedential weight as do published opinions, but they’re often instructive, and as I have preached before, they can often be fairly persuasive when you hand copies up to a trial-court judge. Let’s catch up on what the court has been deciding out of the Virginia Reports spotlight.

Civil procedure
The court decides an interesting issue implicating standing, in Tir Conaill Properties, L.C. v. 2401 Wilson, LLC. You have to read between the lines to get the nature of the dispute, because this week’s decision turns on a wholly procedural ruling. And even then, we don’t know what, exactly, was being litigated. But here’s a stab at divining something about the case.

Tir Conaill is a limited liability company that engages in the thoroughly laudable business of running an Irish pub, Kitty O’Shea’s, on Wilson Boulevard in Arlington. The company sued an entity known as 2401 Wilson, LLC, for something or other. Since the Arlington address for Kitty O’Shea’s is 2403 Wilson Boulevard, we can reliably infer that this is a neighbor dispute. Indeed, here is a listing for a rental of 2401 Wilson, and if you look at the picture, you can clearly see Kitty’s establishment to the right.

The lawyer for the defendant was smart enough to look up a copy of the fictitious-name certificate for Kitty O’Shea’s, and noted that it was filed by “Tirconaill Properties LLC.” That’s almost the same as the name of the plaintiff, but a close look will show you that there are two key differences. I’m assuming that the lawyer discovered that fact shortly before trial, because he didn’t raise it in his pleadings. Instead, he filed a memorandum the day before trial, in which he asserted that the plaintiff didn’t have standing because it hadn’t filed a proper fictitious-name certificate. The filing of that certificate, he asserted, was a statutory prerequisite to filing any suit.

The plaintiff’s lawyer responded that the filing by “Tirconaill Properties LLC” was sufficient to meet that requirement for “Tir Conaill Properties, L.C.” He didn’t move for a continuance in which to respond to the new pleading, and he didn’t assert that he was prejudiced by the eleventh-hour filing. The judge decided that the difference in the name, slight as it might be, was fatal, so he dismissed the proceedings.

On appeal, Tir Conaill claimed that the defendant’s answer had never raised the issue of standing to sue. The appeal thus implicates the question of whether a challenge to standing can be waived by a failure to plead it. As we saw in Monahan v. Obici Medical Mgt. Services back in 2006, some affirmative defenses have to be pleaded, and others don’t. In this week’s order, the Supreme Court classifies this particular standing issue as one of those that don’t have to be pleaded. And since the plaintiff didn’t ask for a continuance (the opinion suggests, but does not say overtly, that such a continuance would have been warranted), it can’t complain about the fact that the issue arose so late.

The order touches on two other important points. First, it illustrates that there is a difference between subject-matter jurisdiction (which can never be waived) and the issue of statutory standing. And second, it refuses to address a claim that the trial court granted summary judgment based in part on a deposition, because the plaintiff never objected to the use of that deposition in the trial court.

Since I don’t know the exact nature of the proceedings, I have no idea whether this ruling will interrupt the flow of Guinness at Kitty O’Shea’s. My sense is that, unless some statute of limitations has expired, the plaintiff may be able to file a proper certificate and then start again from square one.

One last point: In case you wondered about the origin of the plaintiff’s corporate name, which proves its ultimate undoing in this case, Tir Conaill is the name for a medieval kingdom in Ireland, roughly corresponding to County Donegal in the wild northwest part of that island. If you’re up on your Irish history, you might know that the name is sometimes spelled Tirconaill or Tyrconaill, so it’s understandable that the owners might have mistakenly combined the two-word name into one. Here’s a case in which historical accuracy gets in the way of modern litigation.

Sanctions
Have you had enough of sanctions litigation yet? The long drought in such opinions ended with a torrent of decisions a couple of years ago, most famously springing from Ford Motor Co. v. Benitez (2007). I described sanctions as Topic A in the Supreme Court’s jurisprudence for the following year. Happily, the number of cases involving this subject has receded, as overenthusiastic lawyers have gradually learned that using sanctions as a bludgeon is ultimately a losing proposition, particularly when a phone call would likely serve as well.

We get one unpublished decision in a sanctions case this week: Ferris v. Kiritsis arose in the context of a dispute between some mortgage borrowers and their lender. The lender filed an answer to the suit that was timely but wholly ineffective, because it was signed by an officer of the Georgia corporation instead of by a Virginia attorney. The trial judge found the lender to be in default, and reaffirmed that ruling in two motions to reconsider. That judge then had to recuse himself, and another judge was assigned to the case. The lender’s lawyer figured that he might get a more sympathetic ear from the new judge, so he filed a third motion to reconsider.

Instead, get got sanctioned $800 for having filed the motion. But this week, the Supreme Court finds that neither the motion for sanctions nor the order granting them offered anywhere enough detail on why the defendant’s lawyer did anything wrong. In order to stick, a sanctions order must address the standards set forth in the sanctions statute, and set forth how the offending conduct violated those standards. This one didn’t do that.

This ruling is unpublished for two reasons that I can divine. First, the result is driven by the peculiar language of this motion and order, both of which were fairly bare-bones when it comes to statutory analysis. And second, the court was apparently troubled by the vexing question of when, if ever, a trial court can say, “Enough. No more reconsideration motions.” There really isn’t a fixed number of motions you can file in this context, but I suspect that the court was hesitant to lay down a rule in a published opinion that says that a trial court has to keep rehearing the matter until 21 days after final judgment. This too (like the tendency to file inappropriate sanctions motions themselves) is a matter where good judgment on the part of the lawyer needs to prevail; it’s a sort of Darwinian progression, where the lawyers gradually learn that filing yet another motion just won’t get them anywhere.

Arbitration
In most disputes over arbitrability, the little guy (the consumer, say) wants to avoid arbitration and the big guy (often a credit-card issuer or a rental-car company) wants to compel it. Worman v. River Creek Owners Ass’n presents the opposite scenario, where two Loudoun County homeowners sought to arbitrate a dispute with their neighborhood association.

It’s surprising to me how these cases arise from what seem like such little matters. This dispute began when the homeowners wanted to put up a basketball goal on their property. In most neighborhoods, the most complicated part of that process is going to the sporting-goods store and picking out a suitable model, or maybe figuring out how to anchor it so it won’t topple over after the first windmill jam. But when you live in a subdivision that’s subject to recorded covenants, the real hurdle is often persuading your neighbors to allow you to use your land for what you want. That’s the tradeoff for living in a planned community – you give up some of your freedoms in exchange for not having to live next door to a lavender-and-orange house with a collection of two dozen garden gnomes in the front yard.

The association turned thumbs-down three times when the homeowners sought approval for the goal. (Note the eerie parallel to the sanctions case above.) Undeterred, they filed a demand to arbitrate the case, citing a clause in the declaration. The association responded that this particular dispute wasn’t arbitrable. And why wouldn’t it? As long as no one got to review the association’s decision, the association would always win.

But the homeowners won the next round, when the American Arbitration Association determined that the issue was indeed arbitrable. The association went to circuit court to try to block the proceedings, but the judge refused to stop it. The association then did something that it probably now regrets: It refused to participate in the arbitration hearing, sending only two letters saying that it still didn’t think the matter was arbitrable.

I have noted that in my practice, I have a fairly high winning percentage when my opponent doesn’t show up. Guess who won the arbitration.

The homeowners filed a motion in court to confirm the arbitration award, which included not only the right to put up the goal, but attorneys’ fees and costs. This time, the association prevailed in persuading the trial court to set aside the award, finding that the matter wasn’t arbitrable after all.

This week, the Supreme Court reverses and gives the homeowners back their permit. The ruling turns on some fairly specific language in the declaration (hence the unpublished nature of this ruling, which would provide little in the way of precedent for future cases), and employs some time-honored principles of contract interpretation to find that the dispute fell within the very broad contours of arbitrability in the declaration. Now the homeowners get to play ball, while the association tries to figure out how to narrow that gaping hole in the declaration.

Torts
Last week, the court affirmed Lennon v. Alesandrini, in which a plaintiff lost the seemingly un-losable case of a rear-ender. The question was whether the plaintiff could have been contributorily negligent. Here’s the nature of the factual dispute, as recounted in the order:

“Lennon testified that immediately before the accident she “inched” her vehicle forward and stopped for a better view around the curve of Route 50. Alesandrini testified that immediately before the accident Lennon maneuvered her vehicle partially into Route 50 and began to accelerate.”

The jury decided that they believed Alesandrini, and returned a verdict in her favor, despite all that damage to her front end. The court affirms this conclusion over the plaintiff’s vehement objection that someone who gets rear-ended can’t be held to be contributorily negligent (as long as she doesn’t have the car in reverse, for example). The court rejects an assignment of error in which Lennon claimed that Alesandrini was negligent as a matter of law. It also affirms the trial court’s decision to send the issue of contrib to the jury.

I have written in recent months that the justices of the Supreme Court strongly prefer that issues be submitted to juries for all factual determinations, and this case illustrates that view perfectly. The driver of the rear car had at least a potentially plausible explanation for how the collision occurred without her negligence, and the jury was entitled to believe or disbelieve that.

Criminal law
In a sense, my classifying the case of Martinez v. Commonwealth in the criminal-law category serves to perpetuate the problem that the case illustrates. But the case unquestionably has a strong nexus to criminal law, so I’ll stick with it and trust you to understand the distinction.

Martinez was charged with aggravated malicious wounding after he seriously injured a victim with a single punch to the head. He pleaded not guilty by reason of insanity, and the prosecution didn’t fuss with that. But there was an important issue left: Of what particular offense would he be found not guilty? Martinez contended that the evidence in the case rose to a level that would only support a conviction for misdemeanor assault, not the felony unlawful wounding the judge had ascertained.

Now, why on earth would that matter? Why would a defendant who was found not guilty care what the charge was? There’s a simple answer to that. When you’re found not guilty of a felony by reason of insanity, you can be civilly committed indefinitely; but when you’re exonerated of only a misdemeanor, that civil commitment can’t exceed one year. Now you see why he’s so interested in the details, especially since the judge ordered him committed indefinitely.

Martinez originally appealed to the Court of Appeals, but the judges of that court transferred the case to the Supreme Court because Martinez had not been convicted of a crime (and a quick peek at Code §17.1-406 confirms that they’re right about that). Last week, the Supreme Court dismissed the appeal because of a troublesome appellate trap, that of assigning error to the wrong ruling. Martinez’s assignment reads:

“The evidence was insufficient, as a matter of law, to establish that Mr. Martinez acted with the intent to maim, disfigure, disable or kill when he punched the victim a single time with his bare fist and thus was insufficient to support a finding that Mr. Martinez was not guilty by reason of insanity of unlawful wounding.”

That sounds just fine, until you consider that Martinez isn’t appealing the sufficiency of the evidence to convict him, especially since he was never convicted; he’s appealing the duration of his civil commitment. The court thus finds that he’s appealed the wrong finding, so it never reaches the merits of the case.

As always, if any of my readers would like copies of these orders, which will not appear in Virginia Reports, just contact me and I’ll forward you a copy.